[NATURAL GAS ]

LNG DAILY

www.platts.com

Volume 12 / Issue 11 / January 16, 2015

March JKM down to $9/MMBtu

due to ample supply, weak demand

JKM TM

Key Drivers / Market Highlights

Platts daily LNG markers ($/MMBtu)

NWS

tender awarded to trader, portfolio sellers: sources

Tepco,
CFE

Chubu tender awarded to Vitol and GDF Suez

tender expected to see offers at premium to JKM

Shipping Market Highlights

Excellence

to help unload grounded Magellan Spirit

News headlines

9.000 NA

Jan 16

Change

DES Japan/Korea Marker (JKM)

JKM (Mar)
H2 Feb
H1 Mar
H2 Mar
H1 Apr

9.000
9.100
9.100
8.900
8.600

DES Japan/Korea (JKM) Swaps

Apr
May
Jun

7.350 0.000
7.250 -0.100

7.150
NA NA

FOB East Atlantic Marker (EAM)

EAM (Feb)
H1 Feb
H2 Feb
H1 Mar

8.400
8.400
8.400
8.400

DES Southwest Europe Marker (SWE)

SWE (Mar)
H2 Feb
H1 Mar
H2 Mar

NA
-0.150
-0.150
-0.300
NA

NA

NA

NA
-0.100
-0.100
NA

NA

NA

7.140
7.240
7.240
7.040

NA
-0.140
-0.140
NA

NA

NA

Taiwan

DES Northwest Europe Marker (NWE)

NWE (Mar)
H2 Feb
H1 Mar
H2 Mar

6.780
6.880
6.880
6.680

NA
-0.140
-0.140
NA

NA

NA

Malaysias

DES West India

DES West India (Mar)

8.800

NA

NA

Shell,

Shipping rates: Jan 16

Cheniere

Asia Pacific day rate ($/day)

Atlantic day rate ($/day)

Woodside

Global price comparisons ($/MMBtu)

March

JKM down to $9/MMBtu

due to ample supply, weak demand . . . . . . . . . . . . . . . . 2

Mexicos

CFE tenders for 14 cargoes February through

November: source. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Indonesia

to produce 258 cargoes in 2015, down 40

on year: SKK Migas. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Feb

JKM averages $9.91/MMBtu, down 47% on year

amid oversupply. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Cold

December weather boosts Japanese power

utilities LNG demand . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
imports 1.12 million mt in November,
up 12.2% on year: data . . . . . . . . . . . . . . . . . . . . . . . . . . 7
November LNG exports
fall 10% on year to 2.04 million mt . . . . . . . . . . . . . . . . 8
GDF Suez sign deal with Indias Gail
for terminal on eastern coast. . . . . . . . . . . . . . . . . . . . . . 8
signs $1.5-billion finance deal for
Corpus Christi export project . . . . . . . . . . . . . . . . . . . . . 9
eyes Indian LNG demand growth
for new opportunities. . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

64,000
60,000

25
JKM

Price

News.

Henry Hub

15

Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Comparisons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Recent

NBP

20

Contents
Market

Tenders and Strips . . . . . . . . . . . . . . . . . . . . . . . . 4

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Shipping

Prices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

10
5
0
Jan-14
Source: Platts

Mar-14

May-14

Jul-14

Sep-14

Nov-14

Jan-15

January 16, 2015

LNG Daily

Platts Asia LNG assessment rationale

Market Commentary

The Platts JKM for deliveries in Marchthe new front monthwas

assessed at $9/MMBtu Friday. H1 March was assessed at $9.10/
MMBtu, down $0.15/MMBtu, and H2 March at $8.90/MMBtu down
$0.30/MMBtu. Offers for March were reported in the low to mid$9s/MMBtu, with bids in the $8s/MMBtu.

March JKM down to $9/MMBtu

due to ample supply, weak demand

No market data was excluded from the January 16 assessment.

LondonThe Platts JKM for deliveries in Marchthe

new front monthwas assessed at $9/MMBtu Friday, with
H1 March at $9.10/MMBtu, down $0.15/MMBtu, and H2
March at $8.90/MMBtu, down $0.30/MMBtu due to ample
supply and weak demand.
The Northwest Europe Marker for March closed at $6.78/
MMBtu and the Southwest Europe marker at $7.14/MMBtu. The
EAM for February liftings ended at $8.40/MMBtu, down $0.10/
MMBtu on weaker offers.
Offers for March were in the low to mid-$9s/MMBtu DES
Northeast Asia, with bids in the $8s/MMBtu, sources said.
March [delivery cargoes are] tradeable around $9/MMBtu
currently, maybe slightly above or below, depending on who
you transact with and when, a Singapore-based trader said.
The lowest offers were in the high $8s/MMBtu Friday, said
two trading sources, but that could not be confirmed.
Indications for cargoes delivered in the second half of
February were at H1 March prices, sources said. Most demand
for first-quarter deliveries were coming from optimizers
looking to benefit from low spot prices. However, end-user
demand was flat, as buying interest from Japan, South Korea
and China had not materialized in firm bids because of low
downstream consumption.

The rationale applies to the following market data codes: AAOVQ00, AAPSU00,
AAPSV00, AAPSW00, AAPXA00
The Platts JKM price assessments and assessment rationale are published at
market-on-close (MOC) and reflect market values prevailing at the close of the Asian
markets, defined as 16:30 Singapore time. The table on page 2 of LNG Daily may
include trades and/or bids and offers collected after the close of the Asian trading day.

Ample supply available from both basins

Supply, on the other hand, was ample with additional

volumes marketed from both the Atlantic and Pacific basins,
sources said. Trading was thin because of weak demand and
most sources said they were awaiting results of the North
West Shelf sell tender, which was awarded late in Asian
trading hours Friday.
A trading company won some of the tendered volume, sources
said, while others said portfolio sellers were potential winners.
The NWS tender offered an unspecified number of cargoes
on either a DES or FOB basis over three loading slots, sources
said. If bought on a DES basis, cargoes could load February
18-23, February 25-March 1 and March 21-25.
Cargoes awarded on an FOB basis were offered for loading

Reported Atlantic bids, offers and trades ($/MMBtu)

Date

Seller

Loading

Buyer

Basis Loading Window Offer/Bid

Notes

Best Bids/Offers
Jan
Jan
Jan
Jan

16
16
16
16

Northwest Europe
Southwest Europe
Northwest Europe
Southwest Europe

FOB
FOB
FOB
FOB

February
February
February
February

Most recent trades

low 8 offer
mid 8 offer
low 8 offer
mid 8 offer
Price

No trades reported.

Reported North Asian bids, offers and trades ($/MMBtu)

Date

Buyer

Destination Seller

Source

Basis Delivery period

Best Bids/Offers
Jan
Jan
Jan
Jan
Jan
Jan
Jan
Jan
Jan

16
End
16
End
16
16
16
16
End
16
16
End
16

user N Asia
user N Asia
N Asia
Trader
N Asia
Trader
N Asia
user N Asia
N Asia
user N Asia
N Asia

DES
DES
DES
DES
DES
DES
DES
DES
DES

Bid/Offer
March
March
March
March
March
March
March
March
March

Last 5 trades
early Jan
late Dec
mid Dec
mid Dec
early Dec

End
End
End
End
End

user
user
user
user
user

North Asia
Trader
Japan
Trader
Japan
Portfolio
China
Japan

Copyright 2015 McGraw Hill Financial

DES
DES
DES
DES
DES

Price
February
early February
mid February
H2 Jan - H1 Feb
H2 January

below 9 bid
mid 8 bid
mid 9 offer
low 9 offer
high 8 offer
mid 8 bid
high 8 offer
low 8 bid
high 8 offer
mid to high 9s
high 9s
low 10s
around 10
high 9s

Notes

LNG Daily

Asia/Middle East ($/MMBtu): Jan 16

DES Japan/Korea Marker (JKM)
JKM (Mar)
Asian Dated Brent
JKM vs. Henry Hub futures
JKM vs. NBP futures
JKM vs. Asian Dated Brent
JKM vs. SWE
JKM vs. NWE

January 16, 2015

Europe ($/MMBtu): Jan 16

FOB East Atlantic Marker (EAM)
EAM (Feb)
Dated Brent
EAM vs. Henry Hub futures
EAM vs. NBP futures
EAM vs. Dated Brent
EAM vs. SWE
EAM vs. JKM
EAM vs ARA fuel oil

9.000
8.15
5.949
2.085
0.852
1.860
2.220

8.400
8.142
5.280
1.475
0.258
1.260
-0.600
2.270

DES Japan/Korea (JKM) swaps

DES Southwest Europe Marker (SWE)
Apr 7.350
May 7.250
SWE (Mar)
Jun 7.150
Dated Brent
SWE vs. Henry Hub futures
FOB Middle East
SWE vs. NBP futures
FOB Middle East (Mar)
8.500
SWE vs. Dated Brent
SWE vs. NWE
DES West India
SWE vs. JKM
DES West India (Mar)
8.800
FOB Australia (netback)
JKM (Mar)
(-) Freight
FOB Australia (Mar)

9.000
0.81
8.19

Key gas price benchmarks

Japan JCC LNG (Oct)
Japan JCC LNG (Nov)

15.94 Final
16.40 Estimated

Competing fuel prices

JCC crude oil (Oct) ($/b)
JCC crude oil (Nov) ($/b)
HSFO 3.5% sulfur 180 CST FOB Singapore
Qinhuangdao coal
Minas crude oil
Naphtha CFR Japan

100.74 Final
90.82 Estimated
6.85
3.61
7.688
9.153

NOTES: Japan JCC value shows latest available CIF price published by the Ministry of Finance,
converted to US dollars per MMBtu. All other values reflect Platts most recent one-month forward assessments for each product in each region, converted to US dollars per MMBtu. JKM
Marker, SWE LNG and NWE LNG average the assessments of the two half-months comprising
the first full month of forward delivery. Asian LNG assessments assessed at Singapore market
close 0830 GMT, European LNG assessment assessed at London market close 1630 UK time.
NYMEX Henry Hub futures and ICE NBP futures values taken at Singapore market close and
London market close. ICE NBP futures converted from Pence/Therm to $/MMBtu. Asian Dated
Brent crude oil assessed at Asian market close 0830 GMT and converted from $/barrel to $/
MMBtu. Detailed assessment methodology is found on www.platts.com.

Competitive fuels Asia ($/MMBtu)

DES Northwest Europe Marker (NWE)

NWE (Mar)
Dated Brent
NWE vs. Henry Hub futures
NWE vs. NBP futures
NWE vs. Dated Brent
NWE vs. SWE
NWE vs. JKM
NWE as a % of NBP
Competing fuel prices
Northwest Europe fuel oil
ARA coal

6.13
2.24

North America ($/MMBtu): Jan 16

Competing fuel prices
US Gulf Coast 3%S fuel oil
New York Harbor 1%S fuel oil

6.12
6.49

Futures ($/MMBtu): Jan 16

NYMEX HH Singapore close
ICE NBP Singapore close
NYMEX HH London close
ICE NBP London close
NYMEX HH US close

(Feb)
(Feb)
(Feb)
(Feb)
(Feb)

3.087
7.097
3.120
6.925
3.127

(Mar)
(Mar)
(Mar)
(Mar)
(Mar)

3.051
6.915
3.070
6.774
3.087

25

20

20

15

15

10

10

0
Jan-14

6.780
8.142
3.710
0.007
-1.362
-0.360
-2.220
100.10

Competitive fuels Europe ($/MMBtu)

25

7.140
8.142
4.070
0.367
-1.002
0.360
-1.860

Naphtha CFR Japan

Minas FOB Indonesia
Fuel oil 180 FOB Singapore
JKM LNG

Mar-14

May-14

Northwest Europe fuel oil

SWE LNG
NWE LNG
ARA coal

Jul-14

Sep-14

Nov-14

Jan-15

Source: Platts

0
Jan-14

Mar-14

Source: Platts

Copyright 2015 McGraw Hill Financial

May-14

Jul-14

Sep-14

Nov-14

Jan-15

January 16, 2015

LNG Daily

Recent tenders and strips

Tender/
Slots/
Destination/ Pricing Opening
Closing
Strip Period
Cargoes
Seller Buyer Origin
model
Date
Validity Date
Results

Cargo
Origination/
Vessels
Notes

January 16
Tender H1 and H2 Mar

2 cargoes
Sakhalin Energy
Sakhalin
19-Jan
either DES
or FOB

Tender Feb - Nov

14 cargoes
CFE
Manzanillo JKM
23-Jan 22-Jan




Tender April 15 - Mar 16 up to 6

Vitol, Tepco,
GDF Chubu

12-Dec 9-Jan

Contracts must be
executed before Jan 22.
1 cargo/month for Jan-July
and Oct-Nov. 3 cargoes/
month for Aug-Sep

19-Dec Suppliers shortlisted

Tender April-
5+ either
NWS
Unknown
26-Jan

DES or FOB

Sold in 2 tranches. 1
tranche of 2 slots, one
tranche of 4

Tender Feb
1 DES
Posco Gwangyang Unknown
7-Jan
Awarded to a trader.
Issued by Posco and

and
Seller unknown,
other downstream buyers

Komipo
price heard at mid-
$9.00/MMBtu
Tender Feb-Mar

3+ either NWS
DES or FOB

NWS

Unknown

16-Jan 12-Jan

Tender 17 - 19 Jan

1 FOB

Nigeria

Fixed Price 5-Jan

12-Jan 9-Jan

Tender Jan 15 -

Jan 17

86 slots

Egypt

Unknown

90 days 30-Oct

NLNG
Egas

February 7-12, February 14-18 and March 10-14, sources said.

The tender closed January 12.
On the demand side, three of the six cargoes jointly sought
by Japanese power utilities Tepco and Chubu for delivery
between April 2015 and March 2016 would be supplied by
trading company Vitol, sources said. GDF Suez would supply
the remaining cargoes.
Vitol also won the joint buy tender issued by South Koreas
Komipo and Posco for one cargo delivered in mid-February,
sources said,, but that could not be confirmed.
CFEs tender for cargoes delivered February through November
continued to draw significant interest, sources said. Sellers would
likely apply a higher premium to the JKM than used in CFEs
previous tender, in mid-2013. During that tender, crude prices
were less volatile, making it easier to hedge positions.
I would be surprised if the premium isnt bigger, said a
London trader. How do you cover the risk, given the volatility
in both JKM and Brent?
A premium would also be required because CFE is
competing with Asia Pacific buyers, sources said. Potential
prices would need to be high enough to attract volumes away
from other buyers in the Pacific Basin.
The previous CFE tender was priced at about a $1.50/

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Tender extended to Oct 30

MMBtu premium to JKM.

In shipping, the 138,000-cubic-meter Excellence (2.97 Bcf or
84.04 million cu m of gas) is moving to help the grounded
165,500-cu-m Magellan Spirit, trading sources said.
Platts cFlow ship-tracking software showed the Magellan
Spirit grounded off the coast of Nigeria.
The Excellence would attempt to lift some, if not all, of the
Magellan Spirits cargo in order to enable it to refloat, sources
said. Abache Abreu, Desmond Wong

News

Mexicos CFE tenders for 14 cargoes

February through November: source
HoustonComision de Electricidad, Mexicos state-owned
power company, has tendered for 14 LNG cargoes to be
delivered from February through November, said a source
Friday, reading from the tender sheets.
Offers are due by January 22 and must be valid through
January 23, said the source, speaking by phone. All contract
must be executed by January 27.
The tender calls for one cargo delivered in late February, one
in late March, one in April, one in May, one in June, three in
August, three in September, one in October and one in
November, the source said. All cargoes are to be delivered to the
Manzanillo terminal on the Pacific Coast of Mexico, where CFE
owns all the import capacity.
All offers should be indexed to the Platts JKM spot LNG
assessment, the source said. Michael Rieke

January 16, 2015

LNG Daily

Indonesia to produce 258 cargoes in

2015, down 40 on year: SKK Migas

limited due to incomplete floating regasification units, SKK

Migas spokesman Zudaldi Rafdi said Friday.
An FSRU project with 3 million mt/yr of capacity is being
jointly developed by Pertamina and Perusahaan Gas Negara in
Banten, West Java.
The Bontang liquefaction plant in East Kalimantan would
produce 9.72 million mt of LNG (453.92 Bcf or 12.85 Bcm of
gas) this year, compared with output of 10.12 million mt last
year, said Salis Aprilian, president director of operator PT
Badak NGL.
Indonesia is struggling to cut its oil dependency by boosting
use of other energy, such as gas and coal. Anita Nugraha

JakartaIndonesias LNG output will fall to 258 cargoes this

year from 298 cargoes in 2014, with fewer cargoes allocated for
export and more expected for the domestic market, a senior
official at upstream regulator SKK Migas said Friday.
Indonesia would export 200 cargoes this year, down from
267 cargoes last year, said Rudianto Rimbono, head of the SKK
Migas communications division. The 2015 domestic allocation
would rise to 58 cargoes, from 31 in 2014.
One cargo typically contains 125,000 cubic meters (2.69 Bcf
or 76.13 million cu m of gas).
The lower LNG production is due to the expiration last year
of some export contracts because the government did not want
to extend them.
Indonesias domestic LNG demand is expected to remain

Feb JKM averages $9.91/MMBtu,

down 47% on year amid oversupply
SingaporeThe Platts JKM for February-delivery cargoes
averaged $9.91/MMBtu over the December 16-January 15
assessment period, down 47% year on year, as the market
continued to be beset by weak demand, resulting in an
abundance of unsold volumes.
After rolling over at $10.175/MMBtu December 16, the
February JKM dropped to $10.025/MMBtu before the New
Years holiday due to low demand.
Further decline was halted as sellers kept offers in the low

Martin Luther King holiday notice

LNG Daily will not be published on Monday January 19 due to the
Martin Luther King holiday in the United States. The JKM assessments, the European LNG assessments and all other LNG data will
be published on the Platts alert systems as well as in Platts Market
Center. Those data will also be published in the January 20 issue of
LNG Daily.

JKM, natural gas and competing fuel price comparisons

Feb-15

JKM
UK ICE NBP futures
JKM-NBP spread
US NYMEX HH futures
JKM-HH spread
Qinhuangdao coal
180 CST fuel oil

Feb-14

9.911 18.808
7.728
11.315
2.147
7.480
3.166
4.378
6.734
14.464
3.665
4.473
7.761
15.844

Jan-15

Year-on-year change %

10.062
8.802
1.204
4.019
5.998
3.608
10.573

Month-on-month change %

-47.3
-31.7
-71.3
-27.7
-53.4
-18.1
-51.0

-1.5
-12.2
78.3
-21.2
12.3
1.6
-26.6

Note: UK and US front month futures roll at the end of each calendar month. JKM rolls on the 16th of each calendar month.
Source: Platts data

Volume 12 / Issue 11 / January 16, 2015

LNG DAILY
Houston
Michael Rieke; J. Robinson

Director of Market Reporting

Jorge Montepeque

Phone: +1-713-655-2215

Global Editorial Director, Power

Sarah Cottle

Singapore
Stephanie Wilson, Max Gostelow
Phone: +65-6530-6551

Global Editorial Director, LNG

Shelley Kerr

Tokyo
Eriko Amaha
Phone: +81 3 4550 8842
London
Desmond Wong, Luke Stobbart,
Alex Froley
Phone: + 44-0-20-7176-6119
Email: lng@platts.com

Platts President
Larry Neal

LNG Daily is published every business day in New York and Houston by Platts, a
division of McGraw Hill Financial, registered office: Two Penn Plaza, 25th Floor, New
York, N.Y. 10121-2298.
Platts Japan Korea MarkerTM is a trademark of McGraw Hill Financial. All references
to Japan Korea Marker and JKM refer to Platts Japan Korea MarkerTM.
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LNG Daily

$10s/MMBtu, expecting buyers to return with renewed interest

to build inventory after the holidays.
More demand, however, did not emerge in the first weeks
of the year. While some Northeast Asian buyers remained in
the market for February and March cargoes, demand
remained shallow.
Notably absent were the larger Japanese, Korean, and
Chinese buyers who were holding high inventories with little
demand for spot cargoes.
Adding to an already oversupplied market, new spot
volumes were offered from Australias North West Shelf and
Russias Sakhalin facility, as both issued tenders in early January
for cargoes delivered in February and March.
NWS LNG issued a tender for an unspecified number of
cargoes available on either a DES or FOB basis over three
loading slots. The tender closed January 12 with validity until
January 16, several sources said.
Sakhalin issued a tender for a cargo delivered in H1 March
and one in H2 March, though the tender was open only to
term offtakers and equity holders in the project, sources said.
Both projects had earlier added volumes to the Asian market
in November, when they issued tenders for cargoes delivered
from December to February.
As a result of the added supply and weak demand, the JKM
fell to $9.20/MMBtu January 15, the final day of the assessment
period, from $10.025/MMBtu January 2, down 80.025 cent/
MMBtu over the two-week period.
Rapidly falling crude prices also weakened demand. With
ICE Brent futures for January around $50/barrel, LNG contracts
linked to oil, as well as oil, became more competitive.
On the demand side, Japans Tepco and Chubu Electric
recently issued a buy tender, the first joint-procurement tender
of its kind, for six cargoes delivered over 12 months beginning
in April.
As a result of the tender, Vitol would deliver three cargoes, and
GDF Suez would deliver the rest, sources said. The Vitol cargoes
were priced around 13% of the JCC plus an alpha of about 30
cents/MMBtu. The pricing of the GDF Suez cargoes was unknown.
The UK National Balancing Point front-month futures
averaged $7.728/MMBtu over the February assessment period,
down 12.2% from the previous January assessment period and
31.7% lower year on year. The mild weather outlook cut
heating demand, leaving the system long on gas.
Lower NBP prices caused the spread between the JKM and
the NBP to open, averaging $2.147/MMBtu in the assessment
period, up 78.3% month on month. This winters spread,

January 16, 2015

Shipping Prices
Shipping rates: Jan 16
Asia Pacific day rate ($/day)
Atlantic day rate ($/day)
PLF1 Middle East Japan/Korea ($/MMBtu)
PLF2 Middle East NWE ($/MMBtu)
PLF3 Trinidad NWE ($/MMBtu)

64,000
60,000
1.21
1.41
0.72

Shipping rates ($1000s/day)

95
Asia Pacific

Atlantic

85

75

65

55
Jan-14

Mar-14

May-14

Jul-14

Sep-14

Nov-14

Jan-15

Source: Platts

Shipping calculator: Jan 16

Australia-
Middle EastJapan/Korea India

Ship size (mt)

Trip length (days)
Carrier day rate ($/day)
Day rate cost ($/MMBtu)
Boil-off cost
Bunker fuel ex-wharf 380 CST ($/mt)
Fuel oil cost ($/MMBtu)
Cost of voyage ($/MMBtu)

66,000
8
64,000
0.35
0.29
458.50
0.17
0.81

66,000
3
64,000
0.15
0.22
279.50
0.04
0.41

Argentina

Brazil

1.51
1.69
0.85
0.83
1.02
1.12
0.76
1.96
1.02
1.62

1.11
1.29
0.45
0.43
0.62
0.72
1.16
1.56
0.62
1.22

Freight route costs: Jan 16 ($/MMBtu)

South China/

Japan/Korea
Taiwan
West India
Middle East
Australia
Trinidad
Nigeria
Algeria
Belgium
Peru

Russia

Spain
Norway

1.21
0.81
2.63
1.87
1.97
2.21
1.64
0.42
1.97
2.71

1.07
0.73
2.48
1.66
1.83
2.00
1.84
0.55
1.83
2.50

0.41
0.87
1.87
1.28
1.26
1.43
2.05
1.23
1.26
1.93

South West
Europe
1.24
1.93
0.73
0.71
0.24
0.35
1.68
2.20
--
0.85

North West
Europe
North East US
1.41
2.13
0.72
0.76
0.41
--
1.72
2.31
0.41
0.50

2.01
2.51
0.58
1.10
0.83
0.76
1.95
3.01
0.83
1.26

All values calculated based on prevailing spot market values during the day for LNG, bunker fuel and ship chartering. No route cost is calculated for Zeebrugge to
NW Europe, or Spain to SW Europe. Other routes appear blank on days when a public holiday in one or another location means underlying values are not published.
Detailed assessment methodology, including assumed route times and underlying values, is found on www.platts.com

Copyright 2015 McGraw Hill Financial

January 16, 2015

LNG Daily

however, was still well below that seen in February 2014, when
the spread was $7.480/MMBtu, resulting in more opportunities
to move cargoes from the Atlantic to Asia.
Front-month NYMEX Henry Hub gas futures averaged
$3.166/MMBtu over the assessment period, down 21.2% on the
month and 27.7% year on year.
The Platts FOB Qinhuangdao coal price averaged $3.665/
MMBtu December 16-January 15, falling 18.1% year on year,
but gaining 1.6% month on month. Platts FOB Singapore 180
CST fuel oil averaged $7.761/MMBtu over the period, down
26.6% month on month and 51.0% year on year.
Max Gostelow

Cold December weather boosts

Japanese power utilities LNG demand
TokyoJapans 10 major power utilities used 5.37 million
mt of LNG (250.78 Bcf or 7.10 Bcm of gas) in December, up
1.9% year on year and a record for December, as colder weather
boosted heating demand, the Federation of Electric Power
Companies said Friday.
LNG consumption in December was also the highest for any
given month, the FEPC said. The previous high was 5.27
million mt in December 2013. The utilities bought 5.66 million

Fuel consumption by Japans 10 major power firms

LNG (mt)
Crude (kl)
Fuel oil (kl)

Dec 2014

Dec 2013

% change

5,368,311
851,847
1,043,772

5,265,915
993,123
1,303,996

1.9
-14.2
-20.0

Fuel procurement by Japans 10 major power firms

LNG (mt)
Crude (kl)
Fuel oil (kl)

Dec 2014

Dec 2013

% change

5,657,548
841,334
926,017

5,420,123
1,058,865
1,200,902

4.4
-20.5
-22.9

Source: Federation of Electric Power Companies

mt in December, up 4.4% from a year ago.

The companies generated 67,703 GWh of electricity from
thermal power plants in December, up 0.9% from December 2013
and the first year-on-year rise since June 2013, the FEPC said.
Heavy snow was recorded in areas from northern Hokkaido
to some towns on the coast of the Sea of Japan in December.
The FEPC said most utilities recorded year-on-year increases in
electricity generation except Okinawa Electric and Tokyo
Electric due to milder temperatures in the regions they serve.
Coal consumption rose 2.6% year on year to 5.45 million
mt. The companies bought 4.7 million mt of coal, down 7.1%
year on year, while their procurement of crude and fuel oil also
fell 21.8% from a year earlier to 358,590 b/d.
The use of crude and fuel oil, however, dropped 17.5% from
a year ago to 384,615 b/d in December. Eriko Amaha

Taiwan imports 1.12 million mt in

November, up 12.2% on year: data
SingaporeTaiwan imported 1.12 million mt of LNG (52.30
Bcf or 1.48 Bcm of gas) in November, up 12.2% year on year,
but down 0.9% from October, data released Thursday by
Taiwans Directorate General of Customs showed.
Long-term contract imports from Indonesia were flat on the
year while imports from Qatar increased only 0.5% year over
year. Imports from Indonesia were down 25.8% on the month
and imports from Qatar were down 24.6% on the month.
November imports from Malaysia jumped 99.5% from
October to 233,071 mt.
Papua New Guineas LNG project sent Taiwan two cargoes
in November, down from three cargoes in October, with
volumes falling 28.4%.
Taiwans CPC has a 20-year, 1.2-million-mt/yr contract with
PNG LNG on a DES basis, and took its first delivery under the
contract in September.
In November, Brunei LNG continued its trend of a cargo
each month. While CPC does not have any long-term contracts
with Brunei, it has received a cargo from Brunei each month
since July.
CPC has a long-term deal for 2 million mt/yr from Shells
global portfolio, though that deal will not start until 2016. Shell

Henry Hub futures and strips

01/12 01/13 01/14 01/15 01/16

Mon Tue Wed Thu Fri

Feb-015
Mar-015
Apr-015
May-015
Jun-015
Jul-015
Aug-015
Sep-015
Oct-015
Nov-015
Dec-015
Jan-016
3/strip
6/strip
9/strip
12/strip

2.795
2.795
2.788
2.808
2.860
2.913
2.924
2.907
2.932
3.036
3.231
3.376
2.793
2.827
2.858
2.947

2.943
2.932
2.898
2.916
2.964
3.014
3.023
3.009
3.032
3.125
3.304
3.440
2.924
2.945
2.970
3.050

3.233
3.208
3.115
3.120
3.156
3.199
3.207
3.194
3.215
3.298
3.457
3.579
3.185
3.172
3.183
3.248

3.158
3.121
3.036
3.043
3.075
3.121
3.128
3.112
3.136
3.225
3.394
3.521
3.105
3.092
3.103
3.173

Copyright 2015 McGraw Hill Financial

3.5

3.127
3.087
3.016
3.024
3.056
3.102
3.108
3.089
3.114
3.211
3.396
3.531
3.077
3.069
3.080
3.155

($/MMBtu)
3-month
12-month
Prompt month

3.4
3.3
3.2
3.1
3.0
2.9
2.8
2.7
19-Dec

25-Dec

31-Dec

06-Jan

12-Jan

16-Jan

LNG Daily

January 16, 2015

Taiwans November imports

Vol (mt)

Cost ($/mt)

% vol chg

Y-o-y
% cost chg

M-o-m

% vol chg

Qatar
381,498 575.89 0.5 -5.8
Malaysia
233,071 805.38 -23.1 -9.2
Indonesia
183,930 828.83
0.0 -13.0
Papua New Guinea
139,081
811.59
NA
NA
Brunei
64,508 809.85
NA NA
Trinidad
59,278 573.16
NA NA
Nigeria 58,663 857.59 -14.4 -6.1
Total
1,120,029 722.53 12.2 -9.2

% cost chg

-24.6 5.3
99.5 -8.0
-25.8 1.5
-28.4
11.4
-0.3 -5.2
NA NA
NA
NA
-0.9 4.9

Source: Taiwans Directorate General of Customs

is a 25% shareholder in the Brunei LNG project.

Taiwans average import cost in November was $722.53/mt
($13.89/MMBtu), down 9.2% from a year earlier but up 4.9%
from October. Max Gostelow

Malaysias November LNG exports

fall 10% on year to 2.04 million mt
SingaporeMalaysias LNG exports in November totaled 2.04
million mt (2.7 Bcm or 95.3 Bcf of gas), down 10.3% year over
year, data from the Department of Statistics showed Friday.
The largest volume of exports in November went to
Japan, followed by China, Taiwan and South Korea,
according to the data.
Over the first 11 months of 2014, Malaysia exported 22.88
million mt, largely unchanged from 22.93 million mt the
previous year.
Malaysia imported 60,674 mt in November, all from
Norway, while January-November imports totaled 1.18 million

Malaysias 2014 exports

Nov-14

Value

Jan-Nov 2014

Value

Japan
1,450,025 3,921 28,356,910 38,141
China
235,626 329 2,600,886
3,317
Taiwan
177,206 491 2,697,977
7,390
South Korea 176,407 469 3,133,722
8,331
Kuwait
0 0 138,676 264
India
0 0 68,168 145
UAE
0 0 64,980 111
Total
2,039,264 5,210 22,882,864 57,700

Malaysias 2014 imports

Nov-14 Value
Jan-Nov 2014 Value

Norway
Yemen
Algeria
Nigeria
Australia
Spain
Qatar
Total

60,674 162
0
0
0 0
0 0
0 0
0 0
0 0
60,674 162

60,674 162
374,951 1,043
315,589 850
241,223 640
63,395 169
62,266 175
60,372 165
1,178,469 3,204

Units: volume in mt, value in million MR

Source: Department of Statistics, Malaysia

Copyright 2015 McGraw Hill Financial

mt. Yemen was Malaysias largest supplier in the 11-month

period, followed by Algeria and Nigeria.
While state-owned Petronas exports LNG from its Malaysia
liquefaction plant in Bintulu in East Malaysia, it also has a
3.8-million-mt/yr import terminal in Melaka on the Malaysian
Peninsula, where gas demand is booming. Song Yen Ling

Shell, GDF Suez sign deal with Indias

Gail for terminal on eastern coast
MumbaiShell, GDF Suez and a joint venture between
Indian state-owned Gail and the government of Andhra
Pradesh signed agreements late Thursday for the proposed
floating import terminal at Kakinada off Indias eastern coast,
Gail said in a statement.
The Gail-Andhra Pradesh government joint venture, Andhra
Pradesh Gas Development, will have a 48% stake in the venture
while Shell and GDF Suez will each have a 26% stake, the
statement said.
India does not yet have a terminal on its eastern coast.
The floating storage-and-regasification unit at Kakinada
would have capacity of 5 million mt/year of LNG (233.5 Bcf/
yr or 6.61 Bcm/yr of gas), and capacity could double in the
future, Gail said.

Briefs
Cold snap to boost Spanish gas demand
for 10 days: Enagas
BarcelonaSpanish gas grid operator Enagas issued a cold
weather warning for at least 10 days starting January 17, putting
gas and LNG shippers on alert to increase supply.
Enagas forecast that gas demand would rise 230 GWh
beginning January 17, compared with a daily average of around
1.1 TWh so far in January, the Spanish grid operator said Friday.
It expects temperatures to get even colder beginning January 21,
based on official forecaster Aemets 10 day forecast.
In Spain, a cold snap is announced when the temperatures
remain 5-7 degrees Celsius (10.26 degrees Fahrenheit) below
normal. In such a situation, suppliers on interruptible contracts,
CCGTs and gas shippers may receive less gas while gas exports are
also halted.
Occasionally, LNG shipments are also rerouted to help meet
regional demand, while some power generation units can be put on
standby to meet peak demand. Gianluca Baratti

LNG Daily

The proposed terminal will use high-end technology and be

one of the first of its kind in India. The port of Kakinada is
suitable for such a project because of Hope Islands natural
breakwater, which protects against high seas.
N. Chandrababu Naidu, Andhra Pradeshs chief minister,
said he hoped the partners would bring their technological
expertise and complete the project in 18 months.
Apart from picking up stakes in the terminal project, Shell
and GDF Suez signed an agreement for 26% stakes each in a
project to source LNG and to market regasified LNG from the
terminal. Gail holds a 48% stake in that venture.
Shell owns and operates a 5-million-mt/yr terminal at
Hazira in Gujarat on the western coast of India, and GDF Suez
has a 10% stake in Indias Petronet LNG, which owns and
operates two terminalsone at Dahej in Gujarat and another at
Kochi in Kerala.
Gail owns and operates a 5-million-mt/yr terminal at
Dabhol in Maharashtra, also on the western coast.
M.C. Vaijayanthi

Cheniere signs $1.5-billion finance

deal for Corpus Christi export project
DenverCheniere Energy has finalized a $1.5-billion deal to
finance its Corpus Christi, Texas, LNG export project, the
Houston company said Friday.
The deal for a $1.5-billion convertible note purchase by EIG
Management puts the project closer to a final investment
decision, Cheniere said.
The funds will be used as equity to finance a portion of the
costs to build three liquefaction trains with total capacity of 13.5
million mt/year (630.45 Bcf/yr or 17.85 Bcm/yr of gas). The
financing is scheduled to close when Cheniere makes the final
investment decision, which is expected in the first half of 2015.
Cheniere now has all the financing commitments for the
project, the company said. The project still requires regulatory
approvals, additional long-term customer contracts as well as
final financing and investment decisions. Construction is
expected to start in the first half of 2015.
The project now has customers for 63% of its capacity, with
about 45% of the total capacity committed to European buyers,
Cheniere said.
The project is one of eight US export projects expected to be
built, according to Bentek, a unit of Platts. The projects are
expected to use 13.1 Bcf/d of gas by the early 2020s.
The Corpus Christi project would be supplied by a 2.25
Bcf/d pipeline extending 23 miles to interconnects with Texas
Eastern Transmission, Kinder Morgan Texas, Natural Gas
Pipeline, Transcontinental Gas Pipe Line and Tennessee Gas
Pipeline, Cheniere said. Rocco Canonica

Woodside eyes Indian LNG demand

growth for new opportunities
SydneyAustralias Woodside Petroleum is eyeing a forecast
doubling in Indias LNG demand as an opportunity to bring
more local companies into its growth projects, just two days
after signing a pact to cooperate with Adani Enterprises.
The memorandum of understanding with Adani, signed
January 12, covers broad-ranging cooperation on opportunities
including LNG imports and terminal investments in India.

Copyright 2015 McGraw Hill Financial

January 16, 2015

In a speech to an investment seminar in India January 13,

Woodside CEO Peter Coleman said he saw potential for Indian
companies to co-invest in Woodsides LNG-related activities.
Woodside operates the North West Shelf and Pluto LNG
projects, both with Japanese partners, and the Browse
development project, where PetroChina is a stakeholder.
Early investment by foundation customers has been critical
to the development of our projects, Coleman said.
Woodside is well placed to help satisfy Indias growing
LNG demand, which is expected by Wood Mackenzie to grow
to about 35 million mt/year (1.64 trillion cf/yr or 46.27 Bcm/
yr of gas) in 2025 from around 15 million mt/yr in 2015,
Coleman said.
We have a strong and diverse LNG portfolio, with the
flexibility and capability to deliver to the Indian market, he
said. North West Shelf and Pluto LNG equity volumes of 6.6
million mt per annum underpin our supply options.
Woodsides mid-2014 agreement to take 850,000 mt/yr from
Cheniere Energys Corpus Christi project beginning in 2019
would bring supply optionality and geographic diversity to the
companys portfolio, Coleman added. In addition, last month
the company agreed to acquire Apaches 13% interest in the 8.9
million mt/yr Wheatstone LNG project, scheduled to start up in
late 2016.
In total, these transactions will add more than 2 million
mt per annum of future supply to our portfolio, he said.
Woodside hopes to later add equity volumes from its Browse
and Sunrise projects off Australia and Kitimat and Grassy Point
projects in Canada.
The welcome mat is being thrown out to India the same
week Woodside canceled a joint marketing agreement for
Browse gas with its Japanese partner, Mitsui and Mitsubishis
Japan Australia LNG (MIMI) joint venture.
Browse is the most-advanced of Woodsides growth projects
and is now scheduled for a final investment decision in mid2016. Analysts are questioning the projects future given the
recent plunge in crude prices, expected cuts in capex and
increased competition from lower cost LNG producers.
Delays or deferment of project FIDs would result in a supply
crunch, Coleman said.
After 2020, many buyers are looking to emerging supply
regions as a solution, he said. However, we know that
emerging supply regions face many challenges. So we actually
need to make FIDs on new LNG projects now to ensure that we
dont have a global shortfall as early as 2020-2021.
Christine Forster

ExxonMobil to develop PNG field for

LNG expansion, power generation
SydneyExxonMobil will develop the Pnyang gas field in
Papua New Guinea in order to expand the PNG LNG plant and to
use to generate power, the company said in a statement Friday.
Expansion of the PNG LNG plant could include a third
train, the company said.
ExxonMobils local subsidiary has struck a deal with the
PNG government to supply up to 20 MMcf/d of gas for 20
years to improve the capacity and reliability of the
countrys power supply. The agreement is in addition to an
existing supply commitment from the Hides field for
domestic power generation.
Under a memorandum of understanding, some gas allocated
for domestic use would enable PNG LNG to provide up to 25

LNG Daily

January 16, 2015

megawatts of electrical power, or about 20% of current capacity

in the capital Port Moresby, for an interim period while the
government addresses long-term power generation options. The
rest of the gas supply would be used to fuel a new state-owned
gas-fired power unit expected to be located near the LNG plant
outside Port Moresby.
The agreement provides for the award of a petroleum
development license and associated pipeline licenses for the
Pnyang gas field. Pnyang would provide the long-term gas
reserves needed for power generation, and enable expansion of
the PNG LNG project, possibly including the development of
an additional train, ExxonMobil said.
Pnyang is operated and held 49% by ExxonMobil alongside
local partner Oil Search (38.5%) and Japans JX Nippon
(12.5%). The joint venture plans to begin preparing this year to
drill an appraisal well within two years of the awarding of the
petroleum development license, subject to progress of technical
work, permitting and budgeting. Christine Forster

The Barrel
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Calendar of LNG events

January
26-28
LNG Bunkering Summit 2015
Amsterdam, Netherlands
http://www.lngbunkeringsummit.com/
February

18-19
Floating LNG
London, England
http://www.smi-online.co.uk/energy/uk/conference/flng
June
1-5
World Gas Conference
Paris, France
http://www.wgc2015.org/

2-4
World LNG Fuels
Houston, Texas
http://www.worldlngfuels.com/
24-25
LNG Shipping 2015
London, England
http://www.informamaritimeevents.com/event/LNG-ShippingConference
26-27
Platts 14th Annual LNG Conference
Houston, Texas
http://www.platts.com/events/2015/pc515/index
March
2-5
LNG Supplies for Asian Markets 2015
Singapore
http://www.lng-conference.com/

Copyright 2015 McGraw Hill Financial

2-5
FLNG 2015
London, England
http://www.icbi-events.com/event/flng-conference
October
14-16
LNG in BC
Vancouver, British Columbia
http://engage.gov.bc.ca/lnginbc/lng-conference/
27-30
Gastech
Singapore
http://www.gastechsingapore.com/apaclng/

10

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Hear Industry Leaders, including:

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